After being hit hard by the price war between Australian supermarket giants Coles and Woolworths, some relief is in sight for the country's dairy farmers when milk processor Murray Goulburn offered them the highest ever opening milk price of $5.60 per kilomgramme solid.

The offer, a 24 per cent improvement for 2012 levels, translates into 42 cents per litre.

The company also offered a step-up for the milk farmers in recognition of their situation of being tight for cash at the moment. The step-up is a bonus payment for dairy farmers who would supply Murray for a whole year.

Robert Poole, Murray Goulburn manager for shareholder relations, said the company could offer the dairy farmers higher prices now due to higher prices of the commodity in the global market caused by milk shortage.

Mr Poole added the outlook is even better for 2014 as he projects milk price offer to rise between $5.80 and $6 a kilogramme of milk solids.

Besides the supermarket price war, the dairy farmers blamed their tight financial situation to the strong Australian dollar, the introduction of the carbon tax and very low farmgate prices. The carbon tax pushed up electricity cost, bumping up the power bill of Mount Gambier farmer Travie Telford to $317,000 in 2012 and 2013, from $185,000 in 2011 and 2012.

"This increase means we can claw back what we've lost in the past year - this is exactly what we needed and it's a big boost to the industry," Mr Telford said.

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